), Network Appliance (NTAP
) and QLogic Corp.(QLGC
) with buy.
Analyst Paul Mansky says he thinks valuations in this group do not reflect inherent long-term growth opportunities of the enterprise storage market. He thinks deceleration in IT spending has resulted in multiple compressions that belie the storage market's long-term opportunity. Although these stocks are subject to near-term volatility, he believes Network Area Storage, Storage Area Network and emerging hybrid topologies will continue to grow as a percentage of the disk-based storage market, and are forecast to grow at a 12% compounded annual growth rate (2000-2004) to $52 billion.
Mansky set targets of $50 on Brocade; $17 on Network Appliance; and $67 on QLogic.